Airtel sees $3-4 billion annual capex, bets on post-paid to monetize 5G
Bharti Airtel Ltd signalled that elevated network spending is here to stay, with chairman Sunil Bharti Mittal saying the telecom operator expects to keep investing
Bharti Airtel Ltd signalled that elevated network spending is here to stay, with chairman Sunil Bharti Mittal saying the telecom operator expects to keep investing $3-4 billion (approximately ₹28,500-38,000 crore) annually despite completing the bulk of its 5G rollout The guidance signals that even as the peak 5G rollout phase winds down, technology upgrades and network expansion will continue to require multi-billion-dollar investments. It also comes as telecom operators grapple with a key challenge: turning heavy 5G investments into meaningful revenue growth. Also Read | Bharti Airtel Q1 may see steady growth, flat Arpu “This is a highly capital-intensive industry. A large part of our cash flow that generates, gets into networks, whether it is cables, data centres, towers, more radio base stations, transmission elements and indeed laying out fibre across the country. We will continue to do so,” Mittal said at the company's 31st annual general meeting (AGM) on Monday. According to Mittal, Airtel's capex has typically been $3-4 billion a year, with a large part of its 5G investments made over the past three years. “Over a period of time, you should start seeing tapering off of the capex, but I would say that, given the nature of industry, where technology shifts keep on happening at a breakneck speed, capex will always be multi-billion dollars - $3 to $4 billion a year,” he said.
Airtel spent about ₹1.45 trillion on capital expenditure, including its 5G rollout, between FY23 and FY26, according to quarterly reports. Annual consolidated capex stood at $5-5.9 billion between FY24 and FY26, as per its March quarter earnings report. Mittal's comments are significant because much of Airtel's recent spending was driven by 5G deployment. Yet the company acknowledged in its FY26 annual report that monetisation remains challenging due to limited compelling consumer use cases. Also Read | 5G monetization remains a challenge, says Airtel Airtel bought 5G spectrum worth ₹43,084 crore in the August 2022 auction, about half of Reliance Jio's ₹88,078 crore purchase. Betting on premium users To improve returns on its 5G investments, Airtel is betting on premium post-paid customers and its fixed wireless access (FWA) home broadband business. “Post-paid remains a very core pillar of our growth. It's something where we feel we have a chance to differentiate our services for quality customers. Recently, we launched our fastlane technology predicated on 5G slicing and this is something that's received very encouraging signs in the market, and customers seem to be liking it. So post-paid will continue to grow,” Shaswat Sharma, managing director and chief executive of Airtel India, said at the AGM. The company's Fastlane service, which offers a differentiated experience for post-paid users, has also drawn scrutiny.
The BriefWire